APRIL PORTFOLIO UPDATE

MIDDLEFIELD CANADIAN INCOME PCC (LON:MCT)

All information is at 30 April 2021 and unaudited

¹ Based on four quarterly interim dividends of 1.275p per share paid 31 January 2020, 30 April 2020, 31 July 2020, 30 October 2020, and based on the share price as at close of business on 31 December 2020.

² Ongoing charges represent the management fee and all other operating expenses excluding interest as a % of average shareholders' funds for the year ended 31 December 2020.

Performance with Net Income Reinvested

Source: Middlefield, Bloomberg.

Dean Orrico, representing the Investment Manager, noted:

Global equities continued their impressive run in April with MSCI World, the S&P 500 and the TSX Composite returning 4.5%, 5.1% and 4.5% in British Pounds, respectively. The Fund outperformed the benchmark with a net asset value total return of 5.5% and share price appreciation of 6.6%. It also paid its second quarterly distribution in the amount of 1.275p per share, which equates to 5.1p annually and an attractive 4.9% distribution yield.

Momentum in cyclical and value sectors has driven strong market performance since November of last year when initial positive vaccine data from Pfizer, Moderna and AstraZeneca provided a pathway to resolving the pandemic. As vaccination rates climb, the Covid narrative continues to improve and support a widespread reopening of the economy. This trend is most evident in the U.S. where mask mandates are easing, restrictions are lifting and many states have returned to business as usual. With the U.S. moving past the pandemic, investor focus is shifting to a reopening of the global economy for continued market momentum.

The positive equity market performance in 2021 is also attributable to corporate earnings exceeding consensus expectations. Based on the 90% of S&P 500 companies that have reported Q1 2021 earnings thus far, 87% have beat EPS estimates by an average of 23% while 71% have beat on revenues. In addition, management teams remain bullish in their outlooks for the remainder of 2021. While we are encouraged by the solid fundamentals and outlooks of many leading companies, active stock selection is critical to generating superior risk-adjusted returns at this point in the economic cycle.

Real estate was the biggest positive contributor to the Fund's performance this month. RioCan and SmartCentres, both top 10 holdings in the Fund, returned 8.4% and 7.2%, respectively. Retail REITs have been the strongest performing sub-industry in the sector this year, returning 22.3% as at 30 April 2021. Capitalization rates for Canadian retail properties have been stable and fund flows into Canadian REITs have been accelerating. Retail REITs are benefiting from the gradual reopening of the economy and their mixed-use development pipelines also provide significant potential for value creation over the long-term. Notwithstanding their excellent year-to-date performance, we believe RioCan and SmartCentres have further upside given they are still trading at valuation discounts of more than 20% relative to their U.S. peers.

Financials, the Fund's largest sector weight, performed well in April. Core positions in Bank of Montreal, TD Bank and Sun Life Financial were positive contributors, each generating mid-single-digit returns. The Canadian rollout of vaccines is accelerating with approximately 45% of Canadians having received one dose by mid-May. As vaccines gain traction, we expect Canadian bank earnings will continue to be revised higher due to improving consumer credit metrics, higher lending volumes and a steepening yield curve. Canadian banks are trading at just 11.5 times forward earnings and pay an attractive 4% dividend yield on average, creating an opportunity for competitive total returns over the next 12 months.

Enquiries:

Notes to Editors

Middlefield Canadian Income PCC aims to provide long term returns through dividend income and capital growth from a diversified portfolio of predominantly Canadian equity income securities and US stocks. The Company has been listed since 2006 as London's only listed Canadian equity income fund.

For more information on the Company, please visit our website:

http://www.middlefield.co.uk/mcit.htm